Will the Social Security Trust Fund be Insolvent in 2035 in the United Kingdom?

There has been a new social security trustees report published recently that indicates there is a slightly longer time horizon for different program trusts funds. A new depletion date of 2035 has been put forward (a year later than that suggested), but even with this revised date, the whole program is still facing a 75-year deficit.

This bump might seem like a small change, but it could be a much bigger deal than at first glance. Alicia Munnell, who works at Boston College as the director of the Centre for Retirement Research, has compared the bump to an ocean liner and believes congress is running out of time to turn it around.

If action is not taken, then by the year 2035, the trust funds will be insolvent, and only around 80% of the benefits will be payable. Alicia Munnell commented on this, saying, “we’re getting into that area where immediate action will be required.”

It’s worth first discussing what social security trust funds are. They are financial accounts within the US Treasury, and two separate funds are available. These are the Old-Age and Survivors Insurance Trust Fund (OASI), which is a trust fund which pays benefits to people in retirement and survivors. You also have Disability Insurance Trust Funds (DI), which are there to pay benefits to the disabled.